이 기사는 2021년 04월 02일 08시03분 thebell에 표출된 기사입니다

LG Chem has allowed managers to adjust their team members’ compensation in a move to more precisely manage their performance.

LG Chem announced at the end of 2020 that it had given heads of each team the authority to adjust personal incentives and salary for their team members. Previously, incentives and wage increases were fixed based on the grade given by the managers.

It is seen as a move to give greater flexibility to managers to determine their team members’ compensation at their discretion within certain limits. It is also in line with LG Group’s emphasis on the performance-based system.

LG Chem has been testing various measures as part of its project launched last year to make a better company, including compensation competitiveness enhancement.

With managers holding more authority, their responsibility has become heavier. They should convince members by carrying out all processes objectively, from goal setting to evaluation and adjustment of incentives and annual salary. As the burden of work has increased, managers’ monthly position allowances have also risen from March.

Controversy over incentives has grown among the country’s conglomerates this year after SK Hynix faced backlash from employees about their bonus structure. LG Electronics also will hike basic pay by 9% this year, the largest in a decade.

“For this system to settle, each manager has to have a clear understanding of the organization and has to carefully take the difficulty level and the fairness into account from the goal setting stage,” said an industry source. “The monitoring and evaluation processes also have to be systematically conducted so that each member is convinced, which is not an easy thing to do.” (Reporting by Ki-soo Park)